Wal-Mart, world's largest retailer requires that most of its suppliers use RFID labels to identify their shipments to its distribution centers and retail stores. This has a major impact on commerce in the United States and eventually the global marketplace. Similarly, Wal-Mart was a pioneering force behind collaborative planning, forecasting, and replenishment (CPFR). CPFR is considered one of the key factors that helped to propel the retail productivity boom of the 1990's.

RFID labels use radio frequency transmission. The label is equipped with a thin miniature circuitry and antenna. It is designed to respond to radio frequency emitted by a transmitter at the distribution center or the store. The label responds by emitting a unique number which identifies the product, load, and shipment.

Use of RFID labels improves the overall efficiency of the supply chain. It enables automatic tracking of products through the chain and eliminates manual counting and recording at multiple locations. Currently the labels cost between $0.50 and $1.25, and the radio units cost over $1,000. It is anticipated that within the next two years label costs will drop to as low as $0.05 and the radio units to as low as $200, thus making the technology affordable for many other business, industrial, and government applications.